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Palantir Faces Skepticism Despite Strong Growth
Written by Chris Markoch. Article Posted: 4/7/2026.
Palantir Technologies Inc. (NASDAQ: PLTR) is one of the most hotly debated stocks among investors and analysts. Benchmark is one of the latest firms to weigh in. On April 1, the firm initiated coverage on PLTR with a Hold rating and a price target of $150.
That target is close to the stock’s trading range over the past two months.
It’s also more than 20% below the consensus price target of $197.77.
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A recent analyst rating highlights ongoing concerns that high growth expectations may already be priced into shares.
Strong domestic growth, expanding bookings, and industry-leading profitability metrics continue to support the bullish case.
The stock remains under pressure in the near term, making timing a key factor for both bullish and bearish investors.
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The recent pullback has more to do with a broad rotation out of technology—and software—stocks than with company-specific news.
Analyst sentiment on Palantir has generally skewed bullish. The question is whether Benchmark’s rating is an outlier or a signal of further downside.
A Familiar Story for the Bears
Looking beyond the headline rating and price target, it’s useful to understand Benchmark’s reasoning. Their concerns echo much of the bearish commentary that has followed Palantir for years:
To justify its lofty valuation, Palantir must sustain annual revenue growth roughly in the 60%–70% range; otherwise the stock risks further drawdowns.
In fiscal 2025, Palantir’s international commercial revenue grew just 2.5% year over year, which Benchmark interprets as a warning that even some Western allies may not be generating strong demand.
Palantir reported $1.3 billion in total contract value (TCV) bookings, which underscores its ability to retain clients. Still, the company will need a significantly larger pipeline of new customers to fully justify its valuation.
The Numbers Behind the Bull Case
Benchmark’s critique ultimately centers on valuation—a debate that is far from settled. Bears point to fundamentals; bulls point to Palantir’s growth history and a committed retail base that has tended to hold shares through volatility.
That said, the bullish case rests on some concrete facts from the company’s latest earnings report.
In Q4 2025 Palantir posted total revenue of $1.41 billion, up 70% year over year, with U.S. commercial revenue surging 137% to $507 million. That level of domestic acceleration is difficult to write off as a fluke.
Palantir also reported an 8% sequential increase in commercial customers and 49% year-over-year growth. While single-digit sequential gains may not impress everyone, the company has a track record of surprising to the upside.
The firm recorded a record TCV of $4.26 billion for the quarter, up 138% year over year, suggesting an expanding demand pipeline rather than a contracting one.
Perhaps most notable was Palantir’s Rule of 40 score of 127% in Q4 2025—a combined measure of revenue growth and adjusted operating margin. By this metric, Palantir outpaced enterprise software peers such as Adobe (NASDAQ: ADBE), Salesforce (NYSE: CRM), and Workday (NASDAQ: WDAY).
The company reported adjusted operating income of $798 million (a 57% margin), finished the quarter with $7.2 billion in cash and zero debt, and guided for U.S. commercial revenue in excess of $3.14 billion for fiscal 2026—implying at least 115% growth. Those figures do not suggest demand problems.
Investors may accept Benchmark’s concerns about potential softness in commercial growth, but the government side of Palantir’s business is harder to ignore. Palantir’s Maven Smart System has become a formal program of record, positioning Maven as a long-term fixture across branches of the U.S. military.
That designation strengthens Palantir’s military funding and future contract prospects, stabilizing government revenue while commercial demand accelerates. For bears focused on valuation risk, multiyear government commitments of this kind provide structural support that makes the premium more difficult to dismiss (background and analysis).
The Timing Could Be on Benchmark’s Side
PLTR is down nearly 20% in 2026. Although the stock bounced off roughly $129—suggesting a short-term floor—it has experienced drops of 30% or more multiple times over the past five years.
Regardless of which side investors favor, PLTR remains under selling pressure. In late March the stock tested the roughly $165 level—where it stood before the latest pullback—but that advance was rejected. Reclaiming that level would be a key step before any sustained move higher.
Investors who agree with Benchmark may wait for a lower entry before considering PLTR a buy. Conversely, those who focus on the consensus price target could view the current consolidation as an opportunity to accumulate shares.
Karman Tanks 14%: Opportunity or Warning for This Defense Darling
Written by Leo Miller. Article Posted: 3/27/2026.
Key Points
- Defense stock Karman took the market by storm in 2025, with the company growing to a market capitalization of above $10 billion.
- After a 14% post-earnings drop, is there a clear road to recovery ahead?
- A long-term continuation of defense spending increases underpins the stock's valuation.
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In 2025, Karman (NYSE: KRMN) was one of the market's hottest stocks. Shares ended the year near $73, up more than 300% from their IPO price of $22. The new year has been more mixed: the stock is still up over 15% in 2026 but is roughly 25% below its January all-time high.
The reaction to Karman’s latest earnings report amplified that decline, with shares tumbling nearly 14% in a single day.
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Discover the steps you can take to protect your finances nowKarman supplies mission-critical components for rapidly growing defense technologies. The company's revenue growth in 2025 was among the highest in its industry, and it delivered notably strong margins.
Against that backdrop, is there an opportunity in Karman shares? Let’s examine the firm's latest report.
Karman Posts Top-End Growth with Strength Across Segments
In fiscal Q4 2025, Karman reported revenue of $134.5 million, a gain of just over 47% that modestly surpassed estimates. For the full year, revenue rose nearly 37% to $471.5 million. Among more than 20 U.S. aerospace and defense companies with market caps above $10 billion, Karman’s full-year growth rate was second only to Rocket Lab (NASDAQ: RKLB), which grew 38%.
All of Karman’s segments showed strong growth in the quarter:
- Q4 Hypersonics & Strategic Missile Defense: +41.8%
- Q4 Space and Launch: +24.6%
- Q4 Tactical Missiles & Integrated Defense: +77.0%
The company posted a full-year gross margin of 40% and an operating margin of 15.5%, ranking in the top five and top ten, respectively, among the peer group noted above. Karman’s operating margin contrasts sharply with Rocket Lab’s -38% in 2025.
Adjusted quarterly earnings per share (EPS) nearly quadrupled year-over-year, rising from $0.03 to $0.11. Full-year adjusted EPS nearly tripled, from $0.13 in 2024 to $0.37 in 2025. The $0.11 Q4 figure matched expectations.
Adjusted EBITDA margin, a key profitability metric for the company, climbed 230 basis points year-over-year in Q4 to 31.2% and increased 10 basis points for the full year to 30.8%.
Robust Long-Term Defense Spending Is Vital to KRMN’s Outlook
Karman is delivering exceptional results — top-tier growth and margins that outpace many larger firms. Still, the stock trades at a forward price-to-earnings ratio near 130x, which implies the market is pricing in several years of elevated growth and sustained margin expansion.
Clearly, the company benefits from strong demand across key defense verticals. The firm's $800 million backlog provides solid near-term visibility (about 1.7 times 2025 revenue), but it doesn't guarantee growth five to ten years out.
Karman has demonstrated competitive products and attractive profitability, but a very bullish view on long-term defense spending is necessary to justify the current valuation.
Karman Touts “Generational” Demand Increase as Conflicts Wage
Karman is forecasting an even stronger 2026, projecting midpoint revenue growth of 53%. The company expects adjusted EBITDA margin to contract modestly to roughly 29.5% as a result of recent acquisitions.
The firm says it is in the midst of a "generational" increase in demand across missiles, interceptors, hypersonics, unmanned aerial systems, maritime defense, and space and launch, adding, "This is a demand environment that we expect to persist through the end of the decade and beyond." Management also noted potential additional growth vectors such as the "Golden Dome."
Global tensions — including conflicts in Ukraine and the Middle East — suggest defense demand may remain elevated. The White House has requested $200 billion in additional funding related to the Iran conflict, which, if approved by Congress, would be roughly a 24% increase over the Pentagon’s previously approved $838.7 billion budget.
Additionally, European NATO members are committing to significantly boost defense spending as a share of GDP, a rearmament effort that appears to be in the early stages. A potential U.S.–China conflict over Taiwan is another long-term risk that could drive spending.
These dynamics are favorable for Karman. Nonetheless, the company's high valuation makes it a riskier investment, and the steep post-earnings drop — despite strong results and guidance — underscores investor sensitivity to expectations.
Analysts remain generally bullish. The MarketBeat consensus price target near $117 implies about 30% upside from current levels. Two price targets updated after the earnings report average $126, suggesting potential upside of over 40%.
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